Editor's note: Not all documents regarding the city of Russellville's audit were available at press time. There is a pending state Freedom of Information Act request for the auditors' working papers. Look for continuing coverage in future editions of The Courier.

LITTLE ROCK - In a report submitted Thursday to the Committee on Counties and Municipalities of the Legislative Joint Auditing Committee, state auditors determined city-owned computers and software were improperly used by a former Russellville Public Works director and assistant director "to prepare and store" documents for their personal consulting business, among other findings. Attorneys for Morgan Barrett and David Garza, the former Public Works director and assistant director, dispute the auditors' determinations.

A total of four Public Works employees - Barrett; Garza; former administrative assistant Rebecca Sanders; and street employee Bradley Teeter - have been fired since July 2.

Russellville Mayor Tyrone Williamson cited the city's employment "at-will" policy in the terminations of Barrett, Sanders and Garza. Teeter was accused of stealing an undetermined amount of gasoline and various auto parts from the Pope County Complex.

Of the six findings reported by the auditors, two dealt directly with Public Works (see sidebar for the other findings).

According to the report, four city computers and a server were used to produce and store documents for the consulting business and auditors determined the computer files "indicated a significant portion of the documents were prepared during normal city business hours." Auditors also noted Barrett's computer also contained "inappropriate sexually oriented adult material," according to the report. The auditors noted these conditions were in conflict with Arkansas Constitution Article 12, Section 5 and Article 16, Section 13.

In a March 7 letter to Deputy Legislative Auditor Kim Williams, Timothy Murdoch, Barrett's attorney, argued the cited statutes were "misplaced" and did not apply to the situation described by the auditors. A Feb. 18 letter from James Dunham, Garza's attorney, also disputed the statutes' relevance.

Murdoch also wrote Barrett had permission from former Mayor Raye Turner and Alderman Phil Carruth, the city council's Public Works liaison, to engage in outside consulting work and to provide "technical engineering expertise and recommendations" to the city of Clarksville.

"The actions of [Carruth and Turner] were in complete accordance with the city of Russellville personnel handbook," which allowed employees at the time to work on private business and use city-licensed software, Murdoch wrote. He added Barrett, if asked, "would unequivocally state that any consulting work he prepared occurred after hours or on weekends."

As for computer file information indicating the outside work files were used during normal city working hours, Murdoch wrote of two possible explanations:

n "Realize that any time a file is accessed, it will appear work had been performed for as long as the file is open, regardless of whether actual work is being performed on the file at the time." He gave an example of opening a file used for Clarksville in order to adapt it for a Russellville project. "[Barrett] would access that file and have the original [Clarksville] file open while actually working on city business," Murdoch wrote.

n Barrett's computer had an auto save feature which saved all open files at routinely set intervals. "Any open file will show an 'update' every 20 minutes, making it appear that the file is active and in use, whether or not actual work on that file is being performed," Murdoch wrote.

According to Dunham's letter, "All of Mr. Garza's use of city software or equipment was legal and in conformity with [city] policies and specifically approved by both the mayor and [Barrett, Garza's supervisor] ... There is no legitimate claim of illegality regarding this matter."

In the city's Feb. 15 written response, wrote when he was made aware of Public Works employees "conducting outside business activity using city equipment on city time," he asked the Russellville Police Department to conduct an internal investigation and turned over the findings to 5th Judicial District Prosecuting Attorney David Gibbons "for further action."

"This resulted in an ongoing investigation by the Arkansas State Police," Williamson wrote. Gibbons could not be reached by press time to give an update on the status of the investigation.

In response to the finding regarding sexually explicit material found on Barrett's city computer, Murdoch wrote the auditor's comment was vague and did not "clarify whether 'contained' is meant in the sense of an actual stored image or is meant in the sense of Internet history 'tracks' ... or in the form of e-mails."

Murdoch wrote other employees had access to the laptop Barrett used; that as the IT department head's supervisor, Barrett would visit specific sites to test the city's computer firewall; that he and the IT department head conducted an internal investigation into whether another city employee was visiting inappropriate sites on city computers; and that unsolicited e-mails received by Barrett also carried pornographic material.

Murdoch also attached an affidavit signed by Turner in which she declared she had full knowledge of Barrett's outside consulting work and his visits to certain Web sites to "test" the computer system and investigate a city employee.

In the second finding regarding Public Works, auditors cited a June 2005 signal improvement project where all bids were rejected and the project was re-bid in August 2005, with a sole bid of $214,842 submitted and awarded, although another company had a lower bid ($205,795) during the first bidding process. The company with the lower first bid told Arkansas State Police investigators it had not received notice of the second bid process. The auditors noted the company that was awarded the signal project bid was awarded 10 of 12 projects during the period of Aug. 31, 2004 through Feb. 27, 2007, according to the report. The auditors recommended the city and its legal counsel review purchasing procedures.

Murdoch, in his letter, criticized the state police's investigation for not questioning Sanders, who swore in an affidavit she kept a file of communications she made with potential vendors regarding soliciting bids for projects. Murdoch wrote he has not seen the file and it "apparently [has] not been located."

He also wrote the first round of bids were rejected because all three bids came in over the amount budgeted, and the project was re-bid after the city council appropriated more money for the project. According to his letter, the company awarded the job was the only bidder, although four companies obtained plans for the project during the second bid process.

According to documentation supplied by Murdoch as exhibits to his letter, only one of the three original bidders obtained plans for the second bid process.

In Williamson's letter, he wrote to auditors that the city has changed its bid process "where bids are properly advertised and are submitted directly to city hall to the attention of the finance director."